The forex market is mostly trading sideways today with the U.S. dollar struggling to gain traction in the charts. The DXY index, which measures the performance of the USD, shows the dollar dipping to 104.4 on Tuesday.
The U.S. dollar lost 0.16% of its value today in the forex market compared to Monday and is down by close to 0.17 points. The leading currency is having a hard time reviving its lost ground against other global currencies.
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Forex Market Today: What Next For the U.S. Dollar?
The forex market is edging lower today as the U.S. dollar started the day’s trade in the negative territory. Following a three-day holiday in the U.S., the 10-year Treasury bond yield declined briefly on Tuesday’s opening bell.
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However, the forex traders are making use of the dip and accumulating the U.S. dollar today in the markets. The latest data shows that currency investors have been buying the dips on the U.S. dollar for five months.
In addition, hedge funds in Asia are among the top buyers of the U.S. dollar in the forex market today. Read here to know how many leading Asian hedge funds have accumulated the U.S. dollar during its dip.
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The constant accumulation strengthens the U.S. dollar’s resistance level making it easier for the currency to bounce back. Just recently, while the Japanese yen dipped against the USD, forex traders brought the dollar and not the yen. Traders have more confidence in the U.S. dollar today and not local currencies in the forex market.
Along with the U.S. dollar, the prices of gold are also on a decline in the commodity market today. The XAU/USD chart shows gold prices falling to the $2,340 mark and attracting bearish sentiments. Institutional investors are waiting for further developments in the forex and commodity market today before taking an entry position in gold and the U.S. dollar.